The Federal Government will sign a free trade agreement (FTA) with China today that will see tariff reductions for dairy, beef, wine and horticultural producers. There are some key benefits also for Australia’s services sector.
It is not the final ‘legal texts’ however but an ‘undertaking to prepare the texts in both languages’. Parliamentary scrutiny will then be required in Australia before it comes into force, Tony Abbott told Sydney radio station 2GB.
- Threshold for screening by Foreign Investment Review Board (FIRB) increased from $248m to $1.087bn
- Agricultural land FIRB scrutiny is now to be $15m for farm land, $53m for buying an Australian agribusiness – similar to both Korea and Japan
- All investment proposals by Chinese government owned companies will still be scrutinised by the FIRB no matter what the value
Services sector access to China
- Improved access for Australian businesses such as private hospitals and nursing homes – allegedly health providers will be allowed to build facilities in China
- Tourism operators will be able to buy restaurants and hotels
- Australian insurance providers will get access to third party insurance market
- Legal, education architecture, construction and financial services are also beneficiaries with relaxed ownership and access requirements
- The ‘Shanghai Free Zone’ is claimed to be a ‘huge opportunity’ said Chinese Finance Minister Zhu Guangyao according to The Australian Financial Review today in relation to the improved access for the services sector particularly
China will only be able to bring Chinese workers into Australia where there is a ‘demonstrable skill shortage’ similar to those existing under current under 457 visa requirements for ‘temporary visas’.